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CPUC Rejects PG&E Purchase Agreement With Wave Power Company
5 November 2008
The California Public Utilities Commission (CPUC) recently rejected Pacific Gas & Electric’s (PG&E) application to approve a power purchase agreement (PPA) for a 2MW wave power project in Humboldt County, California signed between Pacific Gas & Electric and Finavera Renewables on 18 December 2007.
This was the first wave project submitted to the Commission for approval, and would have resulted in a demonstration project for Finavera’s hydraulic pump buoy system. The project was expected to deliver slightly less than 4 GWh annually with a 1 December 2012 online date.
In its resolution the CPUC found that the project is not viable; that Finavera’s bid does not compare favorably to other bids in PG&E’s 2006 solicitation; and that the contract price is not reasonable.
... the wave energy industry is in a nascent stage. Finavera’s wave technology is pre-commercial, and this proposed contract is for a demonstration project for Finavera’s hydraulic pump buoy system. Finavera deployed a prototype buoy off the Oregon coast in 2007 that was to be tested for 6 weeks. The buoy was supposed to last longer than 3 months, but sank prior to the end of the 6 week period.
—CPUC Energy Division REsolution E-4196
In response to the CPUC’s draft decision, PG&E argued that the rate was reasonable because the technology is new and the project is small. PG&E also said that ratepayers would not be affected if the project is not viable and that a failure to approve the project could negatively affect wave power development in California.
November 5, 2008 in Brief | Permalink | Comments (4) | TrackBack (0)
Comments
Posted by: arnold | November 05, 2008 at 01:31 AM
This refusal to fund development must be very fustrating for the staff working on wave power.
Sadly, the decision indicates that California law does not fund early development of future technology.
The governor needs to go back to the legislature to design a funding mechanism for early development.
Likewise, the president elect needs to deliver on election promises to develop Federal energy policy so that renewable energy developers are not forced to rely on a patchwork of state schemes.
"The California Energy Commission (CEC) was authorized to "allocate and award supplemental energy payments" to cover above-market costs of long-term RPS-eligible contracts executed through a competitive solicitation. The statute required that developers seeking above-market costs apply to the CEC for supplemental energy payments (SEPs)."
The response by Finavera indicates that they have begun investigating alternatives for funding research and development of wave energy:
"Finavera Renewables’ CEO Jason Bak states, “This decision by the CPUC is out of step with federal policy and with other state and city initiatives. Jurisdictions such as Oregon, Washington, the City of San Francisco, New York and New Jersey have all created initiatives to accelerate the development and deployment of marine renewables, in conjunction with the leadership of the Federal Energy Regulatory Commission and Minerals Management Service.”
Bak continues, “Green jobs have been a topic during the recent Presidential debates and we firmly believe that America and the world can see significant economic growth based on the establishment of policy that prioritizes energy security and renewable energy generation. The passage of Energy Improvement and Extension Act of 2008, recently passed by the US House of Representatives and signed into law by President Bush on October 3, 2008, establishes the Production Tax Credit (PTC) for marine renewables. This is a strong step forward for the federal government for recognizing the potential of wave energy.”
Finavera Renewables has begun investigating alternatives for the optimal funding for research and development of wave energy, including the formation of a private consortium. Such a strategy has the potential to diversify the technology risk while simultaneously attracting funding specific to early stage research and development initiatives."
Posted by: Kristoff | November 06, 2008 at 11:55 AM
the wave power potential map refered to rates Californaias coast as a 13 with 30 needed for economical installation.
The same co scales the coast of West Australia where it is trialling and plans to installations at 78.
Posted by: arnold | November 08, 2008 at 09:46 PM
The current unprofitable very early development of fuel cells and solar cells is very much supported by California. Wave power could not possibly prove more unproductive. ..HG..
Posted by: Henry Gibson | November 09, 2008 at 08:26 PM
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there is an interesting (revealing) map of wave power intensity on this page and links to the companies technology.
http://www.carnegiecorp.com.au/index.php?url=/ceto/global-wave-energy